TIL - Trilogy [formerly ECO - Ecoya]

[winner69]

Sure are agreements between bidders and targets common, but remind me when was the last time you have seen the recipient of a low ball offer to commit themselves to recommend the offer to their shareholders (subject to penalties)?

Interesting to note that the reverse break fee is smaller than the break fee ...

Exclusivity clause: I'd call it a legal straightjacket for the board ... with loopholes limited to what the directors are legally obliged to do anyway ...

Just wondering what really enticed the board to sign this agreement ... how can they still claim to work in the best interest of the shareholders? Unless they know that the company is that run down that $2.90 is a good offer - do they?

Maybe not run down ....but maybe the realisation that where they (and super optimistic shareholders) want to get to is going to be long hard struggle with no guarantee of success

Been touting the business around for a while without success until CITIC came along so maybe the directors (and major shareholders) have in the best interests of shareholders recommended to accept this offer.

I doubt the share price would have got to $3 for a while on its own ....and if all this turns to custard and no deal found then $2 is likely

[BlackPeter]

Mmh - lets assume you are right and $2.90 is a really good offer for the company in its current shape and form.

Just wondering - if this would be the case, than why would any bidder put the board into a legal straightjacket and require exclusivity and a guarantee for a positive board recommendation? They would have nothing to fear, given that nobody else would offer more and the directors could make an unbiased and credible recommendation on behalf of the shareholders instead of being ganged into recommending something with no credibility (given that they are now contractually committed to recommend the takeover, no matter what)?

This agreement only makes sense if the bidder knows that the bid is too low and they want to avoid a competing bid at a better price. Sure - I can understand the bidder - always nice to get something on the cheap, but I don't understand the board accepting this.

[Twinklefingers]

I'm a bit disappointed this has happened as I had sold down between $3 and $4.50 on the way up and wanted to just let the remainder ride but I'm not going to vote against it.

This is the first company I own shares in that is being taken over, can anyone recommend a thread I can look through where a company has had a takeover like this? I was thinking of just dumping my shares now and not waiting the extra however many months it takes for everything to go through but the comments from Balance etc regarding higher bids mean I might be making a mistake. If they've already completed due diligence I would've thought things were pretty well along.

[BlackPeter]

I'm a bit disappointed this has happened as I had sold down between $3 and $4.50 on the way up and wanted to just let the remainder ride but I'm not going to vote against it.

This is the first company I own shares in that is being taken over, can anyone recommend a thread I can look through where a company has had a takeover like this? I was thinking of just dumping my shares now and not waiting the extra however many months it takes for everything to go through but the comments from Balance etc regarding higher bids mean I might be making a mistake. If they've already completed due diligence I would've thought things were pretty well along.

Sure - have a look through the TTK thread for takeover which fell through, OIC would be an example for a takeover with a nice and fair offer - and AWK might be worth a look as well (first partial, than complete take over at a fair price). FPA was a charm, but this is now some years ago ... and somewhat different would be ABA (several hostile takeover attempts which fell through).

Not sure I remember another takeover offer which started with such a lowball offer combined with the board voluntarily signing a gagging order, but maybe somebody else has a recommendation?

[kiora]

http://www.nzherald.co.nz/business/n...ectid=10411042

[Yoda]

Im inclined to think a bird in the hand is worth 2 in the bush, and if it all falls over and the price dumps, then buy back on the crash . See if it goes up a bit more this week. Theoretically it should get to 2.90 ?
Was KMD also a takeover fail?

[BlackPeter]

Im inclined to think a bird in the hand is worth 2 in the bush, and if it all falls over and the price dumps, then buy back on the crash . See if it goes up a bit more this week. Theoretically it should get to 2.90 ?
Was KMD also a takeover fail?

Depends on what the markets think ... if they feel there might be a better offer in the bushes, it might go above. If they think the 2.90 is best and final offer, the price will stay below $2.90 - given that there is always a remaining risk and given that there must be a discount for tying up the money for some months (or how long it takes to complete the takeover).

And obviously - markets are not always right - their crystal balls are as cloudy as ours

KMD - correct - this takeover didn't went through either ... however not quite comparable, I think they mainly offered shares instead of cash (but didn't really follow at that stage).

[Balance]

https://www.cosmeticsdesign-asia.com...cquire-Axilone

CITIC is building up its presence in this market.

Inclined to believe that they are not only serious but also, will compete aggressively if another offer (say from BWX) is made.

Just have to look at what happened with Tower - first offer flushed out second much higher offer.

[winner69]

https://www.cosmeticsdesign-asia.com...cquire-Axilone

CITIC is building up its presence in this market.

Inclined to believe that they are not only serious but also, will compete aggressively if another offer (say from BWX) is made.

Just have to look at what happened with Tower - first offer flushed out second much higher offer.

And those evil Directors who apparently no longer work for shareholders will rejoice with higher offers being made and to their best to screw whoever comes along

After all don’t one or two of those Directors have much more skin in the game and will want every extra buck they can get

[BlackPeter]

And those evil Directors who apparently no longer work for shareholders will rejoice with higher offers being made and to their best to screw whoever comes along

After all don’t one or two of those Directors have much more skin in the game and will want every extra buck they can get

Well, let's hope so (that better offers will come). Sort of feels though, I touched with you a nerve with my criticism of the directors actions. How come?

I guess - seriously - can't you imagine a better way for a director to deal with a takeover than to basically sign your soul away for the first offer?

Why do you defend them that vehemently?

I guess I still hope things will go ok-ish for shareholders (though many would lose money at $2.90), but the TIL board lost in my view all credibility with signing this gagging order.